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Turkey Lowers Lira Required Reserves amid Jump in Budget Revenues

Turkey Lowers Lira Required Reserves amid Jump in Budget Revenues

Saturday, 16 February, 2019 - 08:45
FILE PHOTO - A money changer holds Turkish lira banknotes next to US dollar bills at a currency exchange office in central Istanbul April 15, 2015. REUTERS/Murad Sezer/File Photo
Asharq Al-Awsat
Turkey's Central Bank on Saturday lowered the level of lira reserves that banks must hold against deposits, while also raising the limit of gold that lenders can hold.

In an issue of the Official Gazette, the central bank said the reserves ratios were reduced by 100 basis points for deposits and participation funds with maturities up to one year and for other liabilities with maturities up to, and including, three years. All other liabilities were cut by 50 basis points.

It also said the upper limit of holding standard gold converted from wrought or scrap gold was increased from 5 percent to 10 percent of lira reserve requirements.

Reducing reserve requirements gives banks more money that they can use, for example, for lending.

In other economic news, Turkey’s central government budget balance posted a surplus of nearly 5.1 billion Turkish liras ($953 million) in January, new data from the Treasury and Finance Ministry showed.

Turkish budget revenues jumped by 66.6 percent year-on-year to hit 97 billion Turkish liras ($18.1 billion) in January, according to a monthly report.

The budget expenditures stood at nearly 92 billion liras ($17.2 billion) last month, marking a 62.5 percent annual rise.

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